The U.S. Department of Justice is trying to block the Tribune Publishing Co. from acquiring the assets of Freedom Communications Inc., parent company of the Orange Country Register.
The Tribune, which owns the Los Angeles Times and Chicago Tribune, made a $56 million cash bid at a bankruptcy court auction to acquire the OC Register Thursday.
But later in the day, the Justice Department filed a civil antitrust suit in federal district court in Los Angeles claiming the acquisition would give the Tribune a monopoly.
The DOJ also filed a preliminary injunction in order to delay the bankruptcy court’s approval of the deal, which is slated to occur on March 21.
The DOJ noted that if the deal goes through, the Tribune would have “98 percent of newspaper sales in Orange County.” Additionally, the L.A. Times and Freedom’s newspapers together would account for 81 percent of English-language newspaper sales in Riverside County.
A monopoly over newspaper sales in each county would allow the Tribune to “increase subscription prices, raise advertising rates and invest less to maintain the quality of its newspapers,” the DOJ said.
“If this acquisition is allowed to proceed, newspaper competition will be eliminated and readers and advertisers in Orange and Riverside Counties will suffer,” offered assistant attorney general Bill Baer of the Justice Department’s Antitrust Division. “Newspapers continue to play an important role in the dissemination of news and information to readers and remain an important vehicle for advertisers. The Antitrust Division is committed to ensuring that competition in this important industry is protected.”
The Tribune publishes 11 daily newspapers, and is headquartered in Chicago.